Miner Limbo: “How low can you go?”

I have to apologize to some of you poor, tortured souls right up front for the topic of this post. I am genuinely sorry. I understand that for many, the mere mention of the word “miners” will immediately trigger some form of Post-Traumatic Stress Disorder. Maybe the blood pressure will rise and the jaw will clench, or perhaps you may instantly develop an uncontrollable facial tick, like Chief Inspector Dreyfuss whenever someone mentions the name Clouseau.

“Miners!”

Are you twitching? Nobody would blame you. We know you have been to the 4th circle of hell, broken through support there, and kept dropping into the 6th circle. We know that you refer to the mining stock table on your computer as “The Red Sea”. Even self-medicating doesn’t help much, because that bottle of scotch seems comforting at first but then it reminds you that liquor companies are up 41% over the last two years. For that matter, pretty much EVERYTHING is up 41% in the last two years. Dog poop is probably up 41% in the last two years.

So I tell you with complete sincerity that you have my deepest sympathies, and I am truly sorry for what you have been through. You deserved better, and instead you got one of the most bizarre devaluations any of us have ever seen.

That said, I want today to discuss a possible scenario that I have considered, and I believe it may be worthwhile for us to think it through. Please understand I am not saying or predicting this is going to happen, only that it is possible and I want to be ready if it does.

The three-part hypothesis of this post is very simple:

1. Miners have been absolutely slaughtered, diverging tremendously from the overall stock market

2. Stocks in general are overbought and may be poised for a significant correction

3. If this happens, it could take miners to truly insane lows. I want to be ready.

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Part 1: The divergence of miners from the broader market.

GDX plotted against the S&P for the last 2 years. Feel free to self-medicate.

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Part 2: Potential for a major correction in stocks

Lance Roberts of STA Wealth Management published a recent article noting multiple variations of a stock metric he likes to follow that was developed by Professor Robert Schiller, called Cyclically Adjusted P/E or CAPE (link) Anything over 15 is overvalued relative to historical averages, and we are now at 24.6. The short version is, in the last hundred years or so whenever CAPE was above 24 this indicated an extreme level of overvaluation, and each time (1903, 1929, 1966, 2000, and 2007) a severe market correction between 30-80% followed… and we just crossed above this level again:

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Part 3: If the market sells off, how low can the miners go?

It is possible, of course, that even in a market correction, the already low share price of miners relative to the value of the underlying assets would insulate them from the effects of a sell-off, and miners would largely outperform the broader market.

HAHAHAHAHAHAAAAHAAA!!!!! Whooo-boy, that was a hoot, wasn’t it? Mining shares being bought and sold based on the underlying value of the assets and companies? God, I kill myself with this stuff.

Anyway, suffice it to say that if history is any guide, the miners will be beaten like a rented mule if we see a major market correction. Oh, they might go down somewhat less than the overall market (say, a 20% drop while the market as a whole is down 30%), but it seems likely that they will be sold off with everything else. And given how insanely low they already are, it is possible- just possible – that we could witness some of the greatest deals any of us will ever see in our lifetimes. So I wanted to begin researching and do some due diligence, so that I could be ready to pounce and know what it is that I’m hunting for, in case this scenario plays out.

Valuations: Making a list, checking it twice

I have the great good fortune to have a Turdite friend by the name of Steven B. Horse, and SBH…well, let’s just say he trades a little bit. I ran this idea past him, and asked about several ideas including screening companies based on Price to Book value, and he very generously sent me back the following tables. In them, he screened for gold and silver miners whose current price to book value is ALREADY below 1. Now please note that this is by no means a perfect metric, and that there are many others you could look at. This is simply meant as a starting point to generate discussion and in the context of this post, gives us a view of just how crazy some of these stock prices would be if you lopped-off another ten or twenty percent in a market correction. Perhaps generous Turdites can come up with other metrics and lists of potential buys in the comments section of this post. Please note that SBH also included Price to Cash on the right-hand side of the chart, a fascinating addition to the table. Here is what he wrote to me about this exercise:

Mining stocks are trading at valuations that are silly. You will have the contingent of people who will disavow miners for various reasons, but there are plenty of people that will be interested in a list like this. Here is a screener that I ran for gold/silver miners with Price to Book <1. P/B is a decent metric. You will invariably get arguments from people that P/B isn't "the best" metric to use. I would say, however, that it's useful and is one of many that you can use to value a company. Price to Cash on the other hand is hard to argue with. With SSRI for example, you are buying a company today that has cash and securities valued at $6.74 per share for the price of $6.00 per share. So you are getting all the assets (plant, property, equipment, inventory, reserves, intangibles) for free.

Gold Miners Screener PB < 1

Ticker Market Cap ($MM) P/E P/B P/Cash

VGZ $ 27.81 0.55 0.89

EGI $ 46.95 0.94 0.9

AKG $ 169.25 0.73 0.91

RIC $ 40.39 0.37 1.6

GSS $ 114.00 0.52 1.71

THM $ 36.29 0.63 1.81

ANV $ 321.60 8.8 0.41 2.06

RBY $ 250.98 0.58 2.1

IAG $ 1,510.17 10.55 0.41 2.74

SBGL $ 666.95 11.49 0.83 3.24

BAA $ 150.13 21 0.3 3.48

NGD $ 2,332.86 11.78 0.81 4.15

KGC $ 5,149.07 0.77 4.43

EGO $ 3,947.01 21.23 0.67 5.29

HMY $ 1,129.09 0.35 5.4

AUQ $ 879.79 0.46 6.28

GFI $ 2,788.77 47.37 0.66 6.3

BRD $ 136.63 6.56 0.56 6.44

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Silver Miners Screener PB < 1

Ticker Market Cap ($MM) P/E P/B P/Cash

SSRI $ 474.03 0.56 0.87

HL $ 825.70 0.62 2.79

PAAS $ 1,526.20 0.61 3.47

SVM $ 413.29 16.13 0.98 3.69

CDE $ 1,049.10 0.46 4.96

EXK $ 341.01 12.67 0.97 10.24

Importantly, my friend also wrote: I would certainly note in bold italics all caps that this is just a screener, do you own due diligence. I would only add that disclaimer because people on the internet are _______s and most can't/won't do any research. Then they will come back and talk shit, b/c they are ______s.

You heard the man. Do your own research. And no whining.

So to sum this up, I am keeping a close eye on Price to Book and Price to Cash in the case of a major market correction. It seems almost impossible that SSRI, for example, could fall another 15 or 20% but who knows what these insane markets are capable of? If we see a company with 6.74$ per share in cash on hand, going for five bucks a share, well… I’m taking the free money and the free company that goes along with it. I may well do something similar for a number of companies listed on this screen. In short, I am making my list and checking it twice. Of course none of this may come about. The rising QE vapors, directional algos, and Permanent Open Market Operations cash may simply continue to magically levitate this market to infinity, CAPE be damned. But if they don’t, and we see the kind of pull-back historically associated with markets at these overbought levels… well, I want to be waiting in the weeds. Just to see what comes along.

Happy hunting, friends.

About the Author

120 Comments

I agree that Medicare is a Ponzi of the highest order, but again, it didn't get that way because of the everyday citizen. GW Bush added to the problem big-time when he added drug coverage--that was to help his, and Congress' buddies in the pharmaceutical lobby.

I have imagined what it will be like when it all blows up. That's why I moved into the country years ago, have my own well, 40 acres of land, and a means to protect it, along with my neighbors.

Having an ability to make income will be meaningless during the time of chaos. Most people won't be able to get to work, if their job and employer still exist.

I have a hope that my family will survive this chaos, which will last many months, if not years. If they can, then my stack, which is all wet, might help them start a new life.

There is a reason the DHS has piled up 2 billion rounds of ammo--they know the blow-up is coming.

sorry. I was merely pointing out the big part of the entitlement problem.

W took a bad problem and made it worse. It took something like 3 years of Medicare part D, the prescription drug give away (to big pharma) become a $20 trillion unfunded liability. W did in three years, what took social security 70 years... nice.

I am 100% in your camp regarding self sufficiency....I just wonder how that will work if we don't get the masses educated to the point where they are willing to admit that the state is their enemy not their provider. If we don't do that, we are all doomed. The farmland of ancient Rome was abandoned by the owners because the state taxed them out.

But I can't much fault the 35 and under crowd for not being so willing to sign on to a "deal" they didn't get a chance to decide on for themselves.

Amazing. The boomer generation began in 1945. SSI law was passed in 1935. So boomers decided on SSI tens years before the first one was even born!!!! And my mom wasn't even old enough to vote in for FDR in '32. Sheesh.

You left out the even bigger screw-job of when el presidente Obozo decided to add Medicaid into the same basket as Medicare. Now half the people on Medicare are those that haven't worked a day for three or four generations. They are combined (hidden) with those who have.

Charles Savoie has been writing about the Pilgrim Society, and how they stole much of the silver in the world, for many years. I first found him at this site, usually under the heading of Economic War or Federal Reserve--or in the achives:

Four of the largest gold miners (ABX, NEM, GG, and AUY) were barely profitable and had negative free cash flow in Q3. During Q3 gold sales prices averaged about $1,320/ounce. Q3 growth in gold production was about 4%. A business that is growing 4%, marginally profitable, and using cash is not very valuable. Additionally, costs have grown at 14% CAGR over the last 10 years due to deteriorating ore grades or yields.

A business with a lot of cash could return it to the shareholders, but that is rare in practice. Before returning cash to the owners they might have to pay off any/all debt, pension liabilities, and reclamation and remediation liabilities, for example. Businesses that have international operations typically have most of their cash stranded abroad. If the cash were in the US they would use it to pay down their revolving debt facility.

In order to move that cash back to the US the business would incur a significant tax liability, because the US insists that taxes be paid on the profits earned abroad up to the US rates if lower rates were paid abroad. Foreign countries typically offer lower rates to foreign companies to attract investment. This is the main reason why big US international conglomerates report book tax rates around 20% while the US corp tax rate is 35% and state corp taxes usually add another couple %. But, I digress.

Before owners receive any cash distribution, the management team can be expected to reward themselves for their hard work. After all that will be their last chance for a pay day since their company is being liquidated.

On the whole the gold mining industry merits a positive valuation if you believe that gold prices are going up from Q3. Valuations have been hammered over the last several years because costs have increased so quickly - not just because of falling gold prices. The industry has been cutting exploration and new project spending which will limit supply and is, therefore bullish for gold. Mining costs are a floor under long-term gold prices.

You are correct ancientmoney regarding Charles Savoie. My point is why is no one else exposing this group other than Charles and why. Also should we tie this into Jeff Nielson's writings from last month with his mention of the one bank/ gata/ rothschild article. Charles specifically mentions that in his essay.

I'm not sure why nobody else has taken up the silver cause like Savoie has.

Part of the reason may be that because he has dug so deep, and unearthed so much history, and connected so many dots, that there is little else to say.

He presents so many facts, so many points, so many theories that it is very difficult to keep straight. You almost need to create a plot/map as you read his work. How he ever found time to do such in-depth research is beyond me.

I linked Jeff Nielson's latest article above. The "One Bank" idea is not his--he says he named it that after the research by Swiss academics found that 40% of the entire world economy is CONTROLLED by one entitiy, which he calls the One Bank--controlled by the Rothschild family. At least that is his conclusion after his articles were no longer accepted by GATA, because one financial backer of GATA didn't like the reference to the One Bank/Rothschild connection.

Sort of like the conspiracy theory research Nick Elway discussed in AM's earlier post; if you call something a conspiracy, or even if you don't, you get labeled a conspiracy theorist, so you get blackballed--exactly what happened to Nielson.

"Most of what passes for literature and film these days is nothing more than glorified commercials or corporate created twaddle designed for narcissistic, mindless, teenage girls.

Many will dismiss Suzanne Collins' Hunger Games trilogy and the film adaptations as nothing more than run of the mill teenager nonsense. They are making a huge mistake.

Decades from now, if we make the right choices during this Fourth Turning, The Hunger Games will be viewed as the novels and films that captured the darkening, rebellious mood of the Crisis. It is not a coincidence the first novel was published in September 2008.

The worldwide financial meltdown initiated by the Wall Street financial elite and their paid for cronies in the nation's capital, occurred in September 2008 and marked the commencement of this Fourth Turning. Collins has brilliantly created a dystopian nightmare that combines the shallowness and superficiality of our reality TV culture with our never ending wars of choice and rise of our surveillance state, while blending the decadence and debauchery of the declining Roman Empire. She also unwittingly places her characters in their proper generational roles during a Fourth Turning Crisis.

Collins was a military brat who was fortunate enough to have a father that taught her the truth about historical events, not the propaganda taught in our public schools today.

"He was career Air Force, a military specialist, a historian, and a doctor of political science. When I was a kid, he was gone for a year in Viet Nam. It was very important to him that we understood about certain aspects of life. So, it wasn't enough to visit a battlefield, we needed to know why the battle occurred, how it played out, and the consequences. Fortunately, he had a gift for presenting history as a fascinating story. He also seemed to have a good sense of exactly how much a child could handle, which is quite a bit."

She learned lessons about war, poverty, oppression, and the brutality and corruption of the ruling classes. Her knowledge of history, the visual images of reality shows and the Iraq War displayed on TV created the idea for her Hunger Games trilogy."

If the author of Hunger Games learned "lessons about war, poverty, oppression" I would assume that the masses of the exploited population in her trilogy would want some food, some medical care, some basic needs, a living wage? for all their efforts.

Wouldn't you agree that anyone who works should be able to afford food, shelter, and medicine? ergo Increase the minimum wage!

I read about one oz of gold in Weimar eventually being able to buy a city block of real estate.

I hadn't heard that, but I did read about US college students in Berlin purchasing city blocks of housing with their housing allowance.

Copper might be the money of the people.

I read that a German pastor had taken all of the copper pfennigs and two pfennigs that were placed in his church's collection and tossed them into a tub, believing that they were not worth depositing. Then when the hyperinflation came, he lived off these copper coins.

Just my 2 cents on the boomers. For all the Gen Xers that think the guys drawing SSI are the root of the problem, news flash! We tried to stop the madness. We elected guys and sent them to Congress to balance the budget. What did they do when they got there? They immediately reneged on their solemn promises and joined the tax and spend crowd with a vengeance. The boomers have had zero control on the problem since Reagan. The elites put shills up for office and they vote with the elites when they get elected. We have no choice for most of our lifetime except whether the guy in office had a D or R after his name. The boomers of the country are as hosed as the Gen-Xers. None of us are going to get what we paid for. If you want to see who got the deal, look at the Greatest Generation. They paid little and have gotten a bonanza in order for the elites to build up debt to break the country. Those of us that wanted and voted for fiscal responsibility were ignored by the politicos who spent profligately in spite of our strenuous objections. They have paid very little attention to the sheep for the past 30 years. No reform was ever seriously considered. They steam-rolled all protest and pushed in what they wanted over the objections of the electorate. It was debt by design, and it was in spite of the electorate and not to get votes. That spend to get votes idea is PR to explain their actions. The truth is, they wanted to break us and spending was the way to do it. Once a politico was incumbent, they had little trouble being reelected unless the elites turned on them. The elites were the ones they had to please to get reelected, not the people.

& many of you may be asking...how did we catch the Evil Empire vampires...who sucked us dry of our assets?...My little Grand Daughter is now 6 months old...is cute as a button...& likes to play out in the backyard behind the barn where the open pit gold mine is!...She has noticed many things going on...& understands that appearances are not always the real deal!...It may be a big world...but depending on how you look at it...big becomes small...like her ball...& "small wonders" become big!!!...

Richard Russell: “When I read dozens of advisories, I sometimes dream that economics could be simple. How about this: the US Treasury issues bonds, the Federal Reserve buys these bonds with money it creates with the computer, money brought about from thin air. It’s money that nobody worked for an nobody took risks for. The newly created money amounts to over one trillion a year. It’s taking more and more newly created money to produce less and less in the Gross Domestic Product. That’s a trend that could easily end in hyperinflation.

Mark O'Byrne (GoldCore): There is a risk of a sizeable short covering squeeze after last Friday's U.S. Commodity Futures Trading Commission (CFTC) data showed hedge funds had cut their bullish bets on gold to the lowest since July 2007. This means that the speculative hot money is the least bullish on gold since 2007. This suggests that recent heavy selling in gold might have run its course and that speculators and weak hand investors have liquidated their positions which are now being held by stronger hands.

Harvey: Negativity or backwardation is upon us for the first two months. GOFO numbers are now. decreasing in the positive for all months. GOFO rates negative and thus in backwardation for the first two months and heading for backwardation in the 3 and 6 months

GoldCore: Bail-ins are likely to happen at banks that are close to failure in countries that have adopted the FSB bail-in conventions and or do not have financial resources to bail-out their banks. Thus, deposits in failing banks in G20 nations may be subject to bail-ins. The total debt to GDP ratios, household, corporate, financial and sovereign debt, in Japan, the UK and the U.S. are all at very high levels. All three countries have banks whose outlook is far from positive.

John Embry: Now that the manipulation has reached such enormous levels, and it’s becoming apparent to more people that there is very little gold available in the system to back all of these paper claims, if people decide to move aggressively into gold this whole paper charade is going to blow sky-high. The implications of that are unbelievable. It will bring down the entire financial system as we know it, but more importantly it will send the prices of gold and silver to levels that are unimaginable to anybody who is believing the current anti-gold propaganda.

John Embry on the US economy: I was also fascinated by all of the statistics coming out of the US government last week which would have people believe that the US economy is starting to boom. I don’t believe a single one of those fraudulent statistics. Clearly this is all part of a plan to attempt to get some strength into the US dollar. To some extent it worked, but it’s not working anymore. Those strong numbers suggested that the dollar should have been firmer but it wasn’t. It was actually struggling to hold north of 80 on the USDX, which is a significant breakdown point.

James Turk: With imports into China at record levels, and Indian purchases of physical gold coming back - even if through unofficial channels - the physical market is once again getting very tight. Gold has not yet slipped back into backwardation, but its forward rate is at the lowest level since the last time backwardation ended a month ago. The central planners are losing control, and market forces are gaining the upper hand.

Jessie's American Cafe: Another 19,200 ounces of gold bullion were redeemed from the Sprott Gold Trust. Apparently the premiums on physical gold make this an attractive proposition. There is no leverage in the Sprott fund that I can determine, so I doubt it is a risk factor that prompted the redemption. Physical gold bullion is in tight supply judging by a number of factors including the forwards rates and the inventory levels at the ETFs and exchanges. If I had unallocated gold at a dealer or a bullion bank, I would be inclined to move it to a storage only facility where I had very clear title and access if it was a long term holding.

Christine Lagarde, the IMF's managing director, says it is premature to declare the eurozone crisis over. While Greece has achieved a primary budget surplus, this solves almost nothing. It still has to generate a big enough surplus to repay almost €10bn to creditors in May, an impossible task. The EU creditor bloc will almost certainly have to come up with fresh money avert another crisis. IMF chief Christine Lagarde said: "Looking past the headlines, there are clearly signs that not all is well". DS: Lindsey Williams says if Christine Lagarde has her way there will be a revaluation of world currencies by March 2014 in which the dollar will take a 30% hit with respect to the yuan. Lagarde's remarks above reported by Ambrose Evans-Pritchard add more credence to Lindsey's revelation regarding the coming dollar devaluation. Legarde's dollar "revaluation" is just a restatement of Bernanke's long ago stated idea that devaluation is a valuable tool in the Fed's economic tool chest.

Gina Chon: All five regulatory agencies put to a vote and approved the Volcker rule on Tuesday. The compliance date for the Volcker rule will be delayed for a year to July 2015. DS: By the time this rule comes into play, IMO the US economy and probably the country will be toast.

I found this one quite interesting -S&P priced in gold- it spans over 134 years:

It looks quite depressing for gold as it has turned up again-but this is extremely compressed chart- and after previous 2 spikes up , the down move ( meaning gold price gets higher vs. S&P ) contains 2 bottoms, one a bit higher ( gold price lower) , then a small spike ( 1933, 1976) , then another bottom lower.Spikes are indicated by arrows, potential move- by red line. Only then the cycle ends.

It seems today this ratio S&P to gold is very close to a point where it shall turn down again, and reach potentially lower lows . Though it seems like a small move, in time the gold TOP measured in S&P may be as far as 4-6 years away, while the price of S&P in gold can be anything close to 0 since after 100 years, debt based USD may be coming to the end of its current form.

The last factor also makes it impossible to say that S&P will then turn higher in gold after that as the USD valued S&P might not be comparable to this chart anymore.

To summarize: This chart indicates that for the next 3-4 years, if invested sometime soon ( when the small spike reaches its top-and its already quite steep) in gold, the returns in USD will be may be 7-8 times higher than if invested in S&P.

If looking at historical minimums, value of S&P in gold is about 5-6 grams, so either stocks will crash ( deflationary case, depression like in early 1930 ties, tightening of money supply) , or gold will raise ( we may call it inflationary, or loss of confidence scenario, increase in US debt and money supply-like in 1977-1981) , the result will be the same- the returns from owning gold will exceed those from S&P by far. Anything between the 2 extreme cases will also lead to the same result.

This chart finally gives me a bit of relief.. it indicates why debt ceiling in February 2014 is important, as it can go either way ( cancelation of debt ceiling or imposing of debt ceiling limit, or anything in between) , but in each case owning gold is better then stocks in following period, starting from a turning point.

In 1933 the turning point to the second bottom was end of tight money supply culminating in devaluation of USD on Feb1 1934 (bottom) , in 1976-complete loss of trust in US treasuries, their rapid price decline and raise of FED rates:

Since the USA has already seen both extremes, I bet this time it will be something in between that will lead to second bottom.

Why i think this time might be different- after the second bottom is hit- in both previous cases there was run on FED ( 1933) and UST( till 1981) gold, but they managed to stop bleeding of it, reverse by forbidding to use it in USA and by WAR in 1939, and perhaps by Space wars in 1981.

Now there is nothing of significant size left. USG has only 5% of above ground gold, if it even has it in possession. So it has to steal it. The possibility to get gold by force remains, only gold is not anymore in CBs..its private mostly, so who will be fighting whom and how would private wealth end up paying USG in gold for some war between them ( between large holders of private gold)? But i do not want to stray off topic.

Unsubstantiated but here you go anyway. Absolutely no way of checking if this is true as far as I know, so pinch of salt time. I guess we will find out if N Korea starts to act weird.....sorry weirder....

I assume that would be well off the books of the regular market if they are selling.

Seeing as The Volcker thingamebob is in the headlines at the moment (whether it will make a difference we will just have to wait and see - hint, it wont affect UK banks whatsoever for example as I read it), here is a lovely documentary detailing the history of how we got here (UK and US centric). Stick with the first 20 minutes, it picks up after that.

BBC The Partys Over How the West Went Bust 1of2 576p HDTV x264 AAC MVGroup org

Affidavits declaring financial assets ahead of elections in India see gold tumbling out of a lot of political closets.

Author: Shivom Seth
Posted: Tuesday , 10 Dec 2013

MUMBAI (MINEWEB) -

Despite pleas from government to lower gold purchases in a bid to bring down the current account deficit, India's politicians appear to have been soaking up significant quantities of the precious metal.

Though gold appears to have lost its glimmer across global markets, the frenzy at which Indian politicians have been buying gold over the past few years has been laid bare with elections around the corner in India.

As is the practice, candidates standing for election as well as those belonging to political parties have to submit affidavits declaring all their assets - and gold has tumbled out of many closets.

To cite an example, 18 poll candidates of the ruling Congress party and the main opposition party, the Bhartiya Janata Party (BJP) related to nine assembly constituencies in Indore still consider gold as the safest investment.

And this is just one town - Indore. Together, these political heavyweights have invested over $649,911 (Rs 40 million) purchasing 14 kilograms of gold.

Congress candidate Pankaj Sanghvi possesses gold and diamond jewellery worth more than $107,342 (Rs 6.6 million) as mentioned in his affidavit enclosed with the nomination papers, while his colleague, Satyanarayan Patel, has amassed 47 kilograms of the precious metal.

The world’s rich are increasingly investing in expensive stuff, and “freeports” such as Luxembourg’s are becoming their repositories of choice. Their attractions are similar to those offered by offshore financial centres: security and confidentiality, not much scrutiny, the ability for owners to hide behind nominees, and an array of tax advantages. This special treatment is possible because goods in freeports are technically in transit, even if in reality the ports are used more and more as permanent homes for accumulated wealth. If anyone knows how to game the rules, it is the super-rich and their advisers.

Because of the confidentiality, the value of goods stashed in freeports is unknowable. It is thought to be in the hundreds of billions of dollars, and rising. Though much of what lies within is perfectly legitimate, the protection offered from prying eyes ensures that they appeal to kleptocrats and tax-dodgers as well as plutocrats. Freeports have been among the beneficiaries as undeclared money has fled offshore bank accounts as a result of tax-evasion crackdowns in America and Europe
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Rhody: "The spot price is not the gold price; the spot price is the failing market price of paper contracts and forwards."

I'm not popular of course saying this stuff; but so far I have been correct for over two years. The failing paper market still works out for the criminals running the system as the price still goes down....I wish people would stop confusing the spot price with the POG... I would rather be right than popular.

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